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  • CBN, ACAMB push for better customer service

    The Association of Corporate and Marketing Professionals of Banks’ (ACAMB’s) role in providing strategic initiatives to redefine the image of the banking industry, which resonates with customers, has been emphasised.

    The Central Bank of Nigeria (CBN) Corporate Communications Director, Mr. Isaac Okorafor, who spoke at an engagement session during a meeting with CBN by ACAMB’s Exco, observed that the increasing synergy between the CBN and ACAMB will be beneficial in championing new ideas to properly manage the image of the banking industry as a potent vehicle for promoting financial systems stability.

    Pledging CBN’s support to ACAMB, Okorafor listed frequently reoccurring customer feedbacks that have continued to form perceptions around the Banking industry such as appropriate pricing and Bank charges, adding that continuous customer engagement will help clarify misconceptions.

    The apex bank’s spokesman used the opportunity to appraise the ACAMB Exco of the objectives of various CBN’s funding intervention initiatives such as NIRSAL, Agribusiness, Small and Medium Enterprises Investment Scheme, etc. being operated to enable many people access funding to stabilise the economy.

  • Buhari directs CBN to blacklist firms still importing palm oil

    President Muhammadu Buhari has directed the Central Bank of Nigeria to blacklist any firm, its owner and top management caught smuggling or dumping palm oil into the country.

    The presidential directive was disclosed by CBN Governor, Mr Godwin Emefiele, at a meeting with oil palm producers on Friday in Abuja.

    Emefiele warned that henceforth, those caught smuggling palm oil into the country would be blacklisted from all banking businesses and would also be blocked from the foreign exchange market.

    He said that this also included those who tried to smuggle in palm oil through Customs as “hydrogenated vegetable fats”.

    He disclosed that close to about N30 billion had already been disbursed to those currently involved in oil palm farming.

    The apex bank governor said that for those coming newly into the oil business, credit facilities would be extended to them through their banks and that Out-Grower schemes would also be organised.

    “We want to make everybody understand how serious we are and also to emphasise that what we are doing to stop the importation of oil palm into Nigeria is a presidential directive that must be adhered to.

    “Doing this also means that while we are stopping the importation of palm oil, we must do all possible to ensure that palm oil production is aggressively increased in Nigeria.

    “Like you all know, and I never cease talking about it that Nigeria in the 50’s and 60’s used to be the largest producer of oil palm in the world with a market share of 40 per cent.

    “For one reason or the other, particularly because we found crude oil that even today by any analysis is cheaper than palm oil, we decided to abandon our God-given gift – palm oil.

    “By doing that, we lost jobs, our farmers lost jobs because we began to import palm oil from different parts of the world,” he said.

    Read Also: CBN injects $210m into forex market

    Emefiele said that the presidential directive also mandated CBN to expand and provide support to firms and individuals that wanted to expand the production of 10 different commodities in Nigeria.

    The 10 products are rice, maize, cassava, tomatoes, cotton, oil palm, poultry, fish, livestock and cocoa.

    Edo Governor, Mr Godwin Obaseki, who was at the meeting, said that 118,000 hectares of land had been identified for the oil palm programme in the state.

    He said that 115,000 hectares would be used for the actual cultivation while three hectares would be used for infrastructure, including roads.

    “Oil palm and other value crops like rubber, cocoa were the base on which the economy of this country was built at independence.

    “If we are going to see real growth, we need to go back to those products where we have relatively competitive and comparative advantages.

    “In the case of Edo, like I will say in the state, we have the advantage of being the home of oil palm in the country,” he said.

  • CBN injects $210m into forex market

    The interbank segment of the Foreign Exchange Market has received a boost of $210 million from the Central Bank of Nigeria (CBN) following sales concluded last Tuesday.

    Figures obtained from the CBN indicated that authorized dealers in the wholesale segment of the market were offered the sum of $100million, while the Small and Medium Enterprises (SMEs) segment received the sum of $55 million.

    The sum of $55 million was allocated to customers requiring foreign exchange for invisibles such as tuition fees, medical payments and Basic Travel Allowance (BTA), among others.  Confirming the figures, the Director, Corporate Communications Department, Isaac Okorafor reaffirmed the Bank’s commitment towards ensuring stability in foreign exchange market.

    Read Also: CBN moves towards unified naira exchange rate

    It will be recalled that at the last intervention on Friday, June 7, 2019, the Bank injected the sum of $294.7million and CNY31.4million into the Retail Secondary Market Intervention Sales (SMIS) segment.

    Meanwhile, the Naira on Tuesday, June 11, 2019, exchanged at an average of N360/$1 in the BDC segment of the market.

     

  • Emefiele: CBN has no multiple exchange rates

    THOSE accusing the Central Bank of Nigeria (CBN) of operating multiple foreign exchange (forex) rates are wrong, CBN Governor Godwin Emefiele has said.

    What obtains are multiple foreign exchange (forex) windows, Emefiele said.

    The CBN boss spoke at the University of Ibadan (UI) Distinguished Leadership Lecture Series, organised by the university in collaboration with the apex bank in Ibadan.

    The multiple forex windows ensures that forex reaches critical sectors of the economy, he added.

    Emefiele noted that the naira exchange rate had substantially converged around N360/$1, whether it is in the parallel market, or in the CBN.

    Emefiele said: “Let me defend multiple foreign exchange. Banks have responsibility to buy and sell foreign exchange to everybody. If I want to travel, whether you have a bank account or not, you should be free to buy foreign exchange for your trip.

    “We saw a situation whereby the CBN allocates forex to a bank, they only sold to their corporate customers where they can make more money and that put pressure on the market.

    “Then we started allocating forex to banks for Personal Travel Allowances and Small and Medium Enterprises (SMEs), and corporates, and people said we are doing multiple exchange rates. That is wrong. I agree that we have multiple forex windows, not multiple exchange rates.”

    The CBN boss also said that it is unusual for an economy to achieve growth and price stability at a go, adding that one is likely to displace the other. He likened the scenario to one wanting to eat his cake and having it. “You want growth and price stability? You can’t eat your cake and have it,” he said.

    Emefiele, who spoke on the theme: “Up against the tide: Nigeria’s heterodox monetary policy and the Bretton Woods consensus”, said the CBN took several unconventional plans to keep the economy going, and stabilise the exchange rate.

    Some of the measures include the restriction of 43 items that can be produced locally from accessing foreign exchange officially, the introduction of the Investors and Exporters (I&E) Forex Window and capital controls.

    According to him,  transactions in I&E Forex window  have reached over $48 billion since the inception  and our foreign exchange reserves has risen to $45 billion in April 2019 from $23 billion in October 2016.

    He said that balancing the objectives of price stability with output stabilisation, especially in the face of external headwinds, remains a challenge to monetary policy and central banks, particularly in emerging and developing economies.

    Emefiele said: “Since the global financial crisis, many central banks have begun to promote structural transformation and economic growth, beyond the singular mandate of price stability.

    “Consequently, policy toolkits now contain instruments that are aimed at developing the financial sector, engendering wider financial inclusion, and aligning financial policies with sustainable development and growth.”

    Emefiele disclosed that before the onset of the global financial crises, policymaking at central banks had been dominated by neo-liberal and orthodox doctrines, as promoted by key Bretton woods institutions like the International Monetary Fund (IMF).

    He said: “These tenets emphasised price stability as the sole and exclusive mandate of central banks. However, lessons learnt from recent crises, in addition to the global financial crisis, have raised doubts on the validity of this position. What became obvious, following the crisis, is that conventional monetary policy tools were not sufficient in dealing with the complexities resulting from the crisis; such as debt overhang and stagnating economic growth.”

    Though the 2007 CBN Act specifies price stability as the overriding mandate of the CBN, for the CBN, it is achieved when inflation lies within the tolerance band of six to nine per cent.

    Emefiele said the CBN’s experience with heterodox policies expanded during the recent economic crisis that began in 2014 due to some global shocks, three of which were simultaneous and significant in shaping the trajectory of the Nigerian economy.

    The CBN embarked on a cycle of tightening, which culminated in a July 2016 hike in the Monetary Policy Rate (MPR) from 12 percent to 14 per cent. This decision was expected to rein in inflationary pressures that may result from exchange rate pass-through to domestic prices and   ensure that inflation expectations are well anchored.

    “We introduced demand management approaches to conserve our reserves and support domestic production of certain goods in Nigeria. In this regard, we analysed our import bill, and encouraged manufacturers to consider local options in sourcing their raw materials, by restricting access to foreign exchange on 41 items (now increased to 43). Four of these items alone constitute over N1 trillion of our annual import bill.”

  • CBN Deputy Governor gets CIBN Fellowship award

    Central Bank of Nigeria (CBN) Deputy Governor, Financial system Stability,  Mrs. Aisha Ahmad has called for increased commitment to integrity and professionalism among bankers.

    She spoke after receiving the Chartered Institute of Bankers of Nigeria (CIBN) Fellowship award in Lagos during the institute’s extraordinary  Fellowship investiture held in Lagos.

    Mrs. Ahmad said that the theme of the investiture, ”Ethical Dilemma in Financial Institutions: the Way Forward” was apt, adding, ”we all need to build in ourselves that high sense of integrity and do the right thing.

    Usually when you are very clear about your value it is easier to solve ethical dilemmas.” CBN and the economy, going forward(Opens in a new browser tab) Noting that upholding the highest level of ethics and professional standards in the banking industry is critical, Ahmad stressed that it is the responsibility of members of the CIBN to “conduct ourselves both in our personal lives and professionals lives at high standards.”

    Also speaking at the event, CIBN President, Chairman of Council, Uche Olowu,  said history has taught bankers that ethics and professionalism are the cornerstones of the banking business and it is practically impossible to implement sustainable banking principles without good ethical conduct.

  • MPC directs CBN to restrict banks access to bonds, treasury bills

    BANKS’ access to government securities is to be restricted, Central Bank of Nigeria (CBN) Governor Godwin Emefiele said yesterday.

    The Monetary Policy Committee (MPC), said the CBN boss, directed the apex bank to initiate policies or regulations that will facilitate the restriction.

    Emefiele spoke at the end of the MPC meeting in Abuja.

    He said: “In view of the abundant opportunities available to banks for unfettered access to government securities, which tends to crowd out private sector lending, the Committee called on the Bank to provide a mechanism for limiting DMBs access to government securities so as to redirect banks’ lending focus to the private sector, noting that this would spur the much needed growth in the economy.  It called on the government to use all machinery at its disposal to increase tax revenue to enable the government fund its budget adequately.”

    Emefiele added: “It is important and expedient that the MPC gives this directive to the management of the Central Bank because this country badly needs growth. For us to achieve growth, those whose primary responsibilities it is to provide credit, who act as intermediaries in providing credit and are accorded as the catalysts to the economy, must be seen to perform that responsibility.”

    Read also: Heritage Bank promotes CBN’s initiative

    The CBN Governor lamented that Deposit Money Banks (DMBs) “would rather than performing that responsibility to the private sector that are the engine of growth of an economy, they would be directing their liquidity to other sectors of the economy”. “This is what the MPC frowns at and, therefore, giving the management of Central Bank the power to limit the DMBs’ propensity or their appetite for just going for government securities rather than directing credit to private sector of the economy.”

    Emefiele noted that “the truth is that according to our own regulations, there is a particular minimum percentage of treasury bills or government securities that the bank must invest in order to remain liquid. But again, we have observed – and unfortunately too and increasingly so  – that the banks, rather than focusing on granting credit to the private sector, they tend to direct their focus to mainly in buying government securities.”

    The CBN management, Emefiele said, “would certainly take this up and will think of how to do that.”

    On Non-Performing Loans (NPL), the CBN governor said banks had always expressed some resistance to increasing credit ratio to the private sector, given the bad experience surrounding NPL.

    However, the MPC, he announced, has also directed the management of the CBN to “think about administrative, legal and regulatory framework to be put in place to ensure that some of the credit risks that are associated with granting loans to the private sector that ultimately result in NPLs should be mitigated such that when banks decide to begin to lend to the private sector or increasingly that the probability that NPLs would rise should be moderated.”

    The MPC welcomed the improvement in financial soundness indicators, but noted that although the NPLs ratio moderated, it remained above the prudential benchmark. Consequently, the committee considered and recommended to management a proposal to develop a comprehensive administrative legal and regulatory framework to speed up the recovery of delinquent loan facilities of the banking system by taking part in structured engagement with relevant stakeholders and authorities to mitigate credit risk and ultimately open up the credit delivery space in the Nigeria economy.

    Also at the briefing, the CBN stated that the MPC resolved to retain the Monetary Policy Rate (MPR) at 13.50 per cent; retain the asymmetric corridor of +200/-500 basis points around the MPR; retain the Cash Reserve Ratio (CRR) at 22.5 per cent; and retain the Liquidity Ratio at 30 per cent.

    He said that those who voted for a retention of rates at its present level believe the decision “was essential for better understanding of the momentum of growth before determining any possible modifications. They also felt that retaining the current policy stance provides an avenue for evaluating the impact of the apex bank’s intervention policies to support lending to the priority sectors of the economy”.

  • $16.8b capital importation: How the banks stand

    Data supplied by the Central Bank of Nigeria (CBN) and verified by the National Bureau of Statistics, Nigeria (NBS) showed that the total value of capital importation into the country stood at $16.8 billion last year, compared to $12.2 billion the previous year. The United Kingdom was tops with $6 billion representing 35.74 per cent of the total capital inflow within the period. COLLINS NWEZE x-rays how increased investment among countries can lift the country’s economy.

    Global economies are always prone to two realities: periods of boom and bust. Such cycles present opportunities for right-thinking governments to seek external buffers that would address their economic fears through trades and partnerships.

    For instance,  from 2014 to 2017, the global economy witnessed several adverse shocks, some of which were simultaneous and significant in shaping the trajectory of the Nigerian economy.

    The 60  per in oil prices between 2014 and 2016 exposed the structural vulnerabilities of oil-dependent economies like Nigeria.

    Also, the normalisation of Monetary Policy by the  United  States’  Federal Reserve System led to capital flow reversals especially in emerging markets and increased financial fragilities in these countries, including Nigeria.

    Part of the turning point for Nigeria was a culmination of several factors, including support from commercial banks in lifting Nigeria’s capital importation figure. The performances of Stanbic IBTC, Citibank Nigeria and Standard Chartered Bank in attracting foreign capital into the country were outstanding.

    The three lenders, all with substantial foreign equity holdings and investors, underline the imperative of having banks with the global network and resources to support Nigeria’s developmental aspirations.

    Giving more details on the development, Central Bank of Nigeria (CBN) Governor, Godwin Emefiele, explained that Nigeria’s over-dependence on crude oil for over 60 per cent of government revenue and for 90 per cent of its foreign exchange inflows meant that shocks in the oil market were transmitted entirely to the economy via the foreign exchange markets.

    Speaking during the at the Special Convocation of the University of Nigeria, Nsukka, at the weekend, Emefiele said the average monthly inflows of foreign exchange into the CBN   fell from over $3.4 billion in June  2014 low as $500 million in October 2016.

    The decline in foreign exchange earnings was further complicated by the flow reversals from in the U.S.

    With the drop in foreign exchange inflows, the exchange rate at the parallel market rose from N200/$ in August 2015 to N525/$ in January 2017. Inflation also rose from nine per cent in January 2016 to over 18 per cent in January 2017. All these were gradually addressed as more capital flew into the country.

    Read also: Heritage Bank promotes CBN’s initiative

    For instance, data supplied by the CBN and verified by the National Bureau of Statistics, Nigeria (NBS) showed that the total value of capital importation into Nigeria stood at $16.8 billion in 2018 compared to $12.2 billion the previous year. The United Kingdom emerged as the top source of capital investment in Nigeria with $6 billion representing  35.74 per cent of the total capital inflow within the period.

    Chief Executive, Stanbic IBTC Holdings Plc, Yinka Sanni believes that capital importation flows naturally from the lender’s focus on supporting Nigeria’s developmental aspirations through strategic interventions in crucial sectors of the economy that would enable the country take its rightful place as a progressive emerging economy and a favourite investment destination in Africa.

    Stanbic IBTC Holdings under the current leadership was directly involved in the success of the currency swap deal between Nigeria and China, in which the two countries directly exchanged RMB15 billion ($2.4 billion) or N750 billion ($2.1 billion). The CBN had appointed four Nigerian financial institutions as settlement banks for the transaction. Stanbic IBTC made the cut, having met the criteria that reportedly included having an operating office in China. This positioned it to earn a slice of the $30 billion in annual bilateral trade volume between both countries.

    Former Executive Director at Keystone Bank, Richard Obire, said that the flow of the capital importation through the three banks could be as a result of where the funds are coming from. He said that Stanbic IBTC parent company, Standard Bank, is owned 20 per cent by the Industrial and Commercial Bank of China (ICBC), the world’s largest bank, an alliance that yields a strategic partnership with a global reach, immense resources and expertise to help reinvigorate Nigeria’s economy.

    The ICBC, in the context of China’s growing global economic clout, more so in forging ties with Africa, is striving to proactively make inroads into developing countries with its vast untapped potential. To ICBC, Africa offers huge opportunities and limitless partnerships ready for harnessing. As the Standard Bank Group is development-focused, its combination with ICBC, which is also very focused on power, trade and infrastructure financing, creates a strategic synergy with an enormous capacity to facilitate investment flows and access between Nigeria and the rest of the world.

    Besides helping to stabilize the Nigerian currency, it is hoped that in the medium to long term, Stanbic IBTC, which itself has a distinguished pedigree in infrastructure financing, ICBC and Standard Bank will collaborate much further with Nigeria towards a new regime of rapid and massive infrastructure development.

    Obire said that Citibank also has operations across all advanced markets, adding that it is expected that the capital first flows to such banks before getting to other players within the economy adding that it is from the top lenders that the capital will now enter smaller banks.

    “In the 90s, multinational companies we tried to market in Nigeria, were not forthcoming because they were advised in their country of origin on which banks to do business with and they always chose banks with a strong history. Banks like Stanbic IBTC, Citibank and Standard Chartered, always come to their minds,” he said.

    Obire said that many multinational companies, from advanced economies, sometimes fear that local banks with little or no industry history, may run afoul of regulations.

    He said: “For local banks, they have to build a longer history. Aside from FirstBank, other local banks are still relatively new. But the foreign banks have international clout and remain the first choice for multinational companies, whose countries,  the funds come from”.

    He said that leading in capital importation is a game of age and strong root in the financial sector.

    Other analysts and social commentators agreed that Nigeria’s fundamental developmental dilemma is that of infrastructure. From power, which is barely existent, to transportation, which is still cumbersome, from mineral refining, which largely is still untapped and at an undeveloped stage, to agricultural expansion, the tale is the same: underdevelopment and underfunding.

    This situation, they say, invariably requires the solid intervention of players, both local and international, with the experience, expertise, reach and clout to help nurture economic ties necessary to put Nigeria on the path of sustainable growth through huge capital inflows and investment opportunities.

    Former President/Chairman of Council, Chartered Institute of Bankers of Nigeria (CIBN), Mazi Okechukwu Unegbu, said Stanbic IBTC has foreign affiliation with Standard Bank, and direct link to South African investors; Standard Chartered Bank Nigeria, has link with Standard Chartered Bank Group and UK investors while the Citibank has link with Citigroup and US investors.

    He said the lenders attract foreign investors and foreign equity holders, who do business in Nigeria.

    Unegbu said the local banks only have representative offices in foreign countries, and the poor liquidity level in the Nigeria capital market is not helping them.

    He said: “The state of Nigeria’s capital market works against the local banks. Before now, capital from offshore flew through the capital market to Nigerian banks. But our capital market has suffered in the last few years due to several dislocations in the economy. The foreign investors have therefore pitched their tents mainly with the three top banks,” he said.

    Chief Executive, Stannic IBTC Stockbrokers, Mrs Titi Ogungbesan, explained that across the group, the bank has key business units which deal with these international clients and are leaders in the various finance sub-sectors. For example, its custodian business is the largest in the country, Stanbic IBTC Stockbrokers Limited is the leading brokerage firm and its global markets desk is a top participant in the industry also.

    “In addition, its investment banking team has facilitated large primary market transactions in the capital and money market spaces. We are therefore able to offer holistic solutions delivered with the high level of efficiency and integrity to clients, which goes a long way in engendering confidence/ trust for repeat business and even referrals,” she said.

    The UK ahead of the packs

    While Theresa May, the British Prime Minister, was in Nigeria in August last year, she expressed her country’s desire to enhance economic ties with Nigeria through increased investment inflow and job creation. “We want to see increased trade between Nigeria and UK, increased investment, bringing jobs here in Nigeria, and jobs in the UK. This will be good for both countries,” May stated.

    Her pledge expectedly elicited broad smiles from the Federal Government and Nigerians in general, especially considering the nation’s aspiration to drive foreign direct investment (FDI) to stir economic growth. Besides strengthening bilateral relations between Nigeria and the United Kingdom, there are other strategic indicators that underline the imperative of sustaining economic ties between both nations.

    According to data from Nigeria’s National Bureau of Statistics (NBS), the UK maintained its top spot as a source of capital investment in Nigeria in the 2018 capital importation report.

    The total value of capital importation into Nigeria stood at $16.8 billion in the whole of 2018 compared to $12.22 billion capital imported in 2017. This represents 37.49 per cent growth year-on-year.

    However,  in the fourth quarter of 2018, the total value of capital importation into Nigeria stood at $2.1 billion. This represents a decrease of 25.05 per cent compared to the third quarter of 2018 and 60.24 per cent decrease compared to the fourth quarter of 2017.

    The largest amount of capital importation by type was received through Portfolio investment, which accounted for 70.20 per cent ($11.8 billion ) of total capital importation, followed by Other Investment, which accounted for 22.69 per cent ($3.8 billion) of total capital, and then Foreign Direct Investment (FDI) which accounted for 7.11 per cent ($1.19 billion ) of total capital imported in 2018.

    By sector, Capital importation by shares, which is closely related to Equity investment (FDI and Portfolio Investment) dominated 2018 reaching $10.42 billion of the total capital Importation within the period.

    The United Kingdom emerged as the top source of capital investment in Nigeria in 2018 with $6 billion. This accounted for 35.74 per cent of the total capital inflow in 2018.

    US, South Africa, UAE, Belgium follow

    In the second position came the world’s biggest economy, the United States (US) with $3.57 billion; South Africa, $1.15 billion; the United Arab Emirates, $937 million and Belgium, $886 million, the NBS data further showed.

    In its Capital Importation second quarter of 2018 report, Britain also accounted for an impressive $1.77 billion of the total capital inflow to Nigeria within the period, representing 32 per cent of the inflow. However, the figure was a 21 per cent decline from the first quarter of the year.

    Within the period, the US also followed closely with the UK, recording  $1.224 billion total capital importation into Nigeria though it was a decline of 2.9 per cent from the amount recorded in the first quarter. Other major investment contributors during the period were the United Arab Emirates ($535.98 million), South Africa ($396.40 million), Belgium ($368.82 million) and Switzerland ($297.32 million).

    Nonetheless, since 2010, the United Kingdom has been responsible for the highest amount of capital importation into Nigeria, except for just two quarters in 2015.

    How the banks stand

    Another major indicator in the report was the role of banks in facilitating capital importation into Nigeria during the quarter.  It showed that Stanbic IBTC Bank, the banking arm of Stanbic IBTC Holdings Plc, facilitated the highest share of capital flow, accounting for 54.9 per cent of the total foreign capital inflow in the second quarter of 2018, slightly up from the 48.5 per cent share recorded in the previous quarter.

    This was followed by Standard Chartered Bank, Citibank, Access Bank and Zenith Bank, which accounted for 14.82 per cent, 13.11 per cent, 3.61 per cent and 3.52 per cent of the total capital importation respectively. Together, the six banks accounted for nearly 90 per cent of capital importation in the second quarter of 2018.

    In terms of actual figures, Stanbic IBTC facilitated $3.027 billion in capital importation during the quarter, followed by Standard Chartered Bank with $817.231 million and Citibank Nigeria with $722.761 million, while the rest accounted for the balance, though seven banks made no input.

    Overall, the total value of capital importation into Nigeria in the second quarter of 2018 stood at $ 5.513 billion.

    This was, however, a decrease of 12.53 per cent compared to the first quarter of  2018, but a 207.62 per cent increase compared to the second quarter of 2017, according to NBS.

    The decline recorded in the second quarter, the agency added, was as a result of a decline in Portfolio and Other Investments, which declined by 9.76 per cent and 24.07 per cent respectively. The largest amount of capital importation by type was received through Portfolio investment, which accounted for 74.7 per cent ($4.119 billion) of total capital importation, followed by Other Investment, which accounted for 20.5 per cent ($1.132 billion) of total capital, and the Foreign Direct Investment FDI, which accounted for 4.7 per cent ($261.4million) of total capital imported in the second quarter.

    In its approach, NBS categorizes capital importation into three main investment types, namely FDI, Portfolio Investment and Other Investments, each having various sub-categories. It noted that since 2017 second quarter, Portfolio Investment has been expanding faster than the other two categories.

    “Although the absolute value of Portfolio Investment declined in second quarter on a quarterly basis, falling from $4.5 billion in the first quarter, 2018 to $4.1 billion in second quarter, 2018, it remained the largest component of the total Capital Importation in the quarter under review, followed by Other Investments, and then FDI,” NBS stated.

    By sector, NBS indicated, capital could be imported either in the form of shares or directly imported into different economic sectors of the economy. Capital importation as shares, which is closely related to Equity investment (FDI and Portfolio Investment) dominated the second quarter of 2018, reaching $4,091.55 million, or 74.21 per cent of the total capital importation in the quarter. The contribution of share investment increased marginally by 0.03 per cent in the second quarter of 2018.

    “Portfolio Investment remained the most significant component of total capital inflow into Nigeria in the second quarter of 2018, although it contracted by 9.76 per cent over the previous quarter. The total value of Portfolio Investment in the second record was $4.1 billion, which was a 434.64 per cent growth compared to the second quarter of 2017 ($770.51 million).

    Also in the fourth quarter of 2018, foreign direct investment (FDI) accounted for $1.19 billion capital importation into Nigeria; equity, $1.18 billion; portfolio investment, $11.80 billion; bonds, $966.8 million and money market instruments, $8.47 billion.

    For Stanbic IBTC, its performance is in line with what has become traditional, though the performances of Access Bank and Zenith Bank denote the growing role of core local banks in capital importation. Nonetheless, the performances of Stanbic IBTC, Citibank Nigeria and Standard Chartered Bank, all with substantial foreign equity holding, underlines the imperative of having banks with the global network and resources to support Nigeria’s developmental aspirations.

    However, Stanbic IBTC Bank, accounting for over 50 per cent of capital importation in 2018 second quarter, stands out as the only African institution among the trio, being a member of the 155-year-old Standard Bank Group, the largest African financial institution by assets. It is firmly rooted in Africa with strategic representation in 20 countries on the continent.

    The top lenders in the scheme highlight the global network they bring to bear on their operations in Nigeria also demonstrates the pivotal role of banks in facilitating capital importation, which is instrumental in providing the funding and foreign exchange needed to drive economic growth and development.

  • Senate committee to screen Emefiele

    Anambra State Governor Willie Obiano yesterday hailed President Muhammadu Buhari for recommending the retention of Godwin Emefiele as the Governor of Central Bank of Nigeria (CBN).

    The governor’s commendation came as the Senate began Emefiele’s confirmation for another five-year tenure.

    Buhari’s request for Emefiele’s confirmation as governor of the apex bank was on the Order Paper.

    Marked: “Executive Communication” and listed against Senate Leader Ahmed Lawan, it reads “Renewal of the appointment of Godwin I. Emefiele as Governor, Central Bank of Nigeria.

    “That the Senate do consider the request of Mr. President, C-in-C  on the renewal of the appointment of Godwin I. Emefiele as Governor of the Central Bank of Nigeria in accordance with Section 8(1) and (2) of the Central Bank of Nigeria Act 2007.”

    The Senate Leader moved that the request be referred to the appropriate committee for consideration.

    Senate President Bukola Saraki referred the President’s request to the Senate Committee on Banking, Insurance and other Financial Institutions for further legislative action.

    The committee, chaired by Senator Rafiu Adebayo Ibrahim, it was learnt, will give the screening accelerated consideration due to its urgency.

    Emefiele’s first term will expire on June 2.

    Read also: CBN: no position on crypto technology yet

    Asked about the alleged “flood of petitions” against Emefiele’s recommendation for reappointment, a National Assembly source noted that “the petitions for whatever they are worth would be considered by the committee”.

    “It is the duty of the committee, apart from considering the request of Mr. President for the confirmation of the reappointment of the CBN governor as referred, to also look at whatever petitions against the nominee.

    “If the committee fails to consider petitions against the nominee, any Senator has the right to raise the issue at the committee of the whole when the report of the committee will be considered.

    “I will, however, tell you that it is not abnormal for petitions to be written against a nominee for appointment. It does not end at writing petitions.

    “The appropriate committee will consider the merit or otherwise of such petitions. If a petition is found to be frivolous, the committee will make its recommendations accordingly.”

    President Buhari’s letter was read on the floor of the Senate by Saraki.

    Obiano hailed the President’s decision to reappoint Emefiele.

    In a statement in Awka through his Commissioner for Information and Public Enlightenment, C Don Adinuba, the governor praised Buhari for reappointing Emefiele.

    He said the people of Anambra were excited on the reappointment because it was “based purely on merit and an appreciation of the values of policy consistency, national interest, financial system stability and a strong desire for rapid national economic growth”.

    Obiano was quoted as saying in the statement: “One thing which Mr Emefiele’s reappointment signifies is that President Buhari has started in earnest the implementation of the new policy of inclusiveness which he assured the Nigerian people after his reelection last February and an issue which he and I have been discussing in private.

    “Though Emefiele was appointed the CBN Governor five years ago by erstwhile President Goodluck Jonathan, President Buhari saw the need for him to continue in office in the overriding interest of the nation.

    “The President deserves commendation for standing firm on his decision on Emefiele’s reappointment, unlike a former President who was enamoured of Prof Chukwuma Charles Soludo’s brilliance, foresight, energy, patriotism and accomplishments as the CBN governor, but at the end of the day succumbed to pressures from those who didn’t want Prof Soludo back for parochial reasons.

    “The nation should expect more balanced appointments from President Buhari in his second term, and this is the pathway to national greatness.

    “Massive economic progress can come about only when we choose the best candidates for key public offices, regardless of their ethnicity or the faith they profess.”

    Obiano described Emefiele’s policies as courageous, sound and in the interest of the Nigerian people.

    He believes that the Southeast will benefit more from Buhari in infrastructure and appointments in his second term.

    Obiano described the President as a fair-minded person who does not want to injure any zone.

    He said: “President Buhari did more for the Southeast in terms of providing critical infrastructure than in giving them key appointments, but he will this time do both because he is a fair-minded person who wants all sections of the country to have a great sense of belonging in the Nigerian federation.”

     

  • United Capital, Africa Fintech Foundry partner on Fintech

    United Capital Plc has partnered with Africa Fintech Foundry for the AFF Disrupt 2019 conference.

    The conference which holds on Thursday, May 16 at  Landmark Event Centre, Victoria Island  will engender interaction about fintech through panel discussions, masterclasses and the main conference itself.

    Speakers are expected from the length and breadth of the local and international fintech community, including leaders of top banking, telecommunications and technology organizations around the country and continent.

    According to the Group Chief Executive Officer of United Capital, Peter Ashade, “as an industry leader in finance and an organization committed to financial inclusion across the continent, we are very aware that fintech is the future of finance.

    Consequently, we are also very interested in the conversation on innovating and shaping the future of fintech itself as a tool for driving our purpose.”

    Ashade said, our participation at Disrupt 2019 aligns with our group strategy of leveraging technology to better empower our clients with bespoke financial services. “We are aware that eight out of the top ten global brands are Fintech companies and what better way to show our involvement than to be part of this conference.

    During the conference, visitors can come to our stand to learn more about United Capital various offerings as well as set up an Investnow account among others,” he added.

     

  • Reps to probe ministry, CBN, bank over mismanaged agric grant to Oyo

    The House of Representatives is to investigate allegations of gross violation of the Public Procurement Act by the Central Bank of Nigeria (CBN), Federal Ministry of Finance and First Bank of Nigeria Limited over grant to Oyo State to procure agricultural equipment.

    The House was not impressed by the fact that the primary beneficiaries of the grant were denied access to it because some public and private sectors officials manipulated the process.

    The Public Procurement Committee saddled with the responsibility of investigating the matter was given three days to report back to the House for further legislative action.

    This followed the adoption of a motion of urgent national importance by Bode Ayorinde  (PDP, Ondo), who  recalled that in 2009, the CBN established the Commercial Agriculture Credit Scheme in collaboration with the Federal Ministry of Agriculture and Water Resources to fast-track the development of the agricultural sector; enhance national food security; reduce the cost of credit in agricultural production; increase national output; generate employment; and raise the level of foreign exchange earnings of the country.

    He said since the scheme was wholly funded by the Federal Government, all stakeholders are required under Section 15(1)(a)&(b) of the Public Procurement Act 2007 (“the Act”) to comply fully with the Act in all its procurement activities.

    He noted that contrary to the provisions of the Public Procurement Act and extant guidelines and regulations from the Bureau of Public Procurement (BPP), the administration of the Commercial Agriculture Credit Scheme in Oyo State was fraught with abuses, corruption and breach of the Public Procurement Act.

    Read also: Agricultural grant: Reps to investigate Finance Ministry, CBN, First Bank

    According to him, a number of approvals were issued under the Scheme for agricultural equipment to be procured under the Commercial Agriculture Credit Scheme based on which funds were released to Oyo State government and domiciled in First Bank of Nigeria. He regretted that beneficiary farmers in Oyo State have not received the disbursements, the suppliers of the agricultural equipment have not been paid and there are rife allegations that the State Government in collusion with officials of the Federal Ministry of Finance, the CBN and First Bank have opted to deposit the funds in a fixed deposit account and the interest income derived therefrom is shared among this cartel.

    “This is a classic case of gross misconduct and the highest form of unethical behaviour by First Bank of Nigeria.

    “The actions of these officials in the public and private sector is undermining and sabotaging the intention of the Federal Government in making Nigeria fully self-sufficient in food production and an exporter of food and raw materials.”

    “If urgent steps are not taken to investigate these allegations and address any proven infractions, an institutional system of manipulation of the procurement and disbursement process would have been created and an awkward situation would have been created which will lead to financial losses to the Nigerian government.”

    The motion was unanimously adopted after a voice vote.